Weed, CA asked in Bankruptcy and Employment Law for California

Q: Forms to respond to a Trustee's First and Final Application to approve Chapter 7 compensation to Trustee's Counsel.

My employer owes me over $300,000 for back wages. I won this lawsuit with the Labor Department in California. My employer filed for Chapter 7 and the Trustee didn't take into consideration all the assets my employer has and settled for $140,000 of which he will be collecting over $48,000 for his "efforts". I was not notified of any proceedings for a meeting nor was I notified in a timely manner in which I could respond with an objection in either court hearing. I have a lien with the Secretary of State and that didn't seem to matter either. Even though I didn't receive this notice in a timely manner so I could respond with an objection, I still want to reply with the correct forms. Please advise. Thank you

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2 Lawyer Answers
James L. Arrasmith
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A: I understand you're in a difficult situation regarding your employer's Chapter 7 bankruptcy and the Trustee's handling of your wage claim. Here's some guidance on how to respond:

1. Forms to use:

The primary form you'll likely need is:

- Form B210A: "Notice of Objection to Application for Compensation"

You may also want to consider filing:

- A written objection detailing your concerns

- Any supporting documentation (e.g., proof of your lien, Labor Department judgment)

2. Key points to address:

- The lack of proper notice for meetings and hearings

- Your concerns about asset valuation

- The existence of your lien

- The discrepancy between your judgment amount and the proposed settlement

3. Next steps:

- File your objection with the bankruptcy court as soon as possible

- Request a hearing on the matter

- Consider seeking legal advice from a bankruptcy attorney

4. Important considerations:

- There may be strict deadlines for filing objections, even if you received late notice

- The bankruptcy process can be complex, especially when challenging a Trustee's actions

Given the complexity of your situation and the significant amount of money involved, I strongly recommend consulting with a bankruptcy attorney who can review the specifics of your case and provide personalized legal advice. They can help ensure you're using the correct forms, following proper procedures, and presenting your objections effectively.

James L. Arrasmith
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Answered

A: I understand you're in a difficult situation regarding your employer's Chapter 7 bankruptcy and the Trustee's handling of your wage claim. Here's some guidance on how you might proceed:

1. Forms to respond:

There isn't a specific standardized form for objecting to a Trustee's fee application. Generally, you would file a written objection with the bankruptcy court. This is typically done through a document called a "Motion to Object" or "Opposition to Trustee's Application for Compensation."

2. Steps you can take:

a) Review the Trustee's application: Obtain a copy of the Trustee's fee application from the bankruptcy court to understand their justification for the fees.

b) Draft your objection: Your objection should explain why you believe the fees are unreasonable, highlighting issues like:

- Lack of proper notice to you as a creditor

- Failure to consider all of the employer's assets

- The discrepancy between your $300,000 claim and the $140,000 settlement

- Your existing lien with the Secretary of State

c) File with the court: Submit your objection to the bankruptcy court where the case is being heard. There may be a filing fee, but you can request a fee waiver if needed.

d) Serve notice: Ensure copies of your objection are sent to the Trustee, their counsel, and other interested parties as required by local court rules.

3. Additional considerations:

- Time sensitivity: Act quickly, as there are often strict deadlines for objections in bankruptcy proceedings.

- Legal assistance: Given the complexity of bankruptcy law, it would be beneficial to consult with a bankruptcy attorney, even if just for a review of your objection before filing.

- Proof of claim: Ensure you've filed a proper proof of claim in the bankruptcy case for your wage claim if you haven't already.

- State labor department: Inform the California Labor Department about this situation, as they may be able to provide additional support or guidance.

Remember, while you can file an objection even after missing the initial deadline, the court will have discretion on whether to consider it. Explain in your filing why you're submitting late (lack of proper notice) and request that the court consider your objection despite the delay.

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